Managing Option Contract in Supply Chain with B2B E-Markets under Disruptions

Abstract:

This paper investigates the supply chain with one single supplier and one single retailer under coexistence of B2B E-markets and traditional wholesale markets. By establishing a mathematical model with considering disruptions which affect the market demands during the lead time of retail order, we calculus the supplier’s optimal product strategy, the retailer’s optimal initial order quantity of products and option, the retailer’s optimal quantity of excised option and optimal quantity of order from B2B E-markets. The research shows that the option contract relocates interests and risks between the members, and effectively response the changes in market demand with B2B E-markets under disruptions. Finally the conclusion is verified by numerical example

• Periodical: Advanced Materials Research (Volumes 433-440)
• Pages: 3138-3145
• DOI: https://doi.org/10.4028/www.scientific.net/AMR.433-440.3138
• Online since: January 2012
• Authors: Jian Ruan, Su Lin Pang
• Keywords: B2B E-Markets, Disruptions, Managing, Option Contract, Supply Chain

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